Indian PM invites Apple's Tim Cook to manufacture locally, talks Apple Pay, partnerships

Posted:
in General Discussion edited October 2015
During a recent meeting, Indian Prime Minister Narendra Modi reportedly invited Apple CEO Tim Cook to set up local manufacturing in his country, while also bringing up other topics like Apple Pay.

Image Credit: <a href=@MEAIndia on Twitter" height="440" />
Image Credit: @MEAIndia on Twitter


Cook "responded positively" to the manufacturing idea, an Indian government spokesman told the Times of India. The executive also advocated the idea of the app economy and its boons to entrepeneurship, and noted that Apple is making investments to expand its Indian operations.

Cook suggested that India is a special place for every Apple worker in that co-founder Steve Jobs visited the country as a young man, using the trip as inspiration for launching Apple.

The pair further brought up the topic of Apple Pay, and how it might be a part of initiatives like Jan Dhan Yojana, a Modi program designed to expand the reach of financial services such as bank accounts. Apple Pay is currently available only in the U.S. and the U.K., and so far there have been no rumors of an Indian launch.

Cook was allegedly very interested in becoming a partner in Modi's Digital India program, intended to make government services available electronically, wire up rural areas with high-speed Internet, and improve digital literacy.

Though iPhone sales have done better in the past year, India has proven a tough market for Apple, owing to factors like the unique structure of its phone market and rules on foreign ownership. Even though there are over 4,000 places where people can buy Apple products, there are no official Apple Stores.
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Comments

  • Reply 1 of 22
    Quote:

    Originally Posted by sog35 View Post

     

    India is the next big market for growth.

     

    i think we see growth from China the next 3-5 years at least.

    And after that India the next 5 years.

     

    So Apple has 10+ years of growth that is untapped.  They can easily grow revenue at an average of 7% the next 10 years.  


    India, Russia, Brazil are all big markets for growth for Apple.

  • Reply 2 of 22
    canukstorm wrote: »
    India, Russia, Brazil are all big markets for growth for Apple.

    The BRIC hype is a bust. Those countries are growing (economically) slower than was originally theorized.

    Also if Apple moves any manufacturing to India, they'd be wise to move very slowly. The near-Communistic attitudes there could prove hazardous to Apple's investments.
  • Reply 3 of 22
    Quote:
    Originally Posted by SpamSandwich View Post





    The BRIC hype is a bust. Those countries are growing (economically) slower than was originally theorized.



    Also if Apple moves any manufacturing to India, they'd be wise to move very slowly. The near-Communistic attitudes there could prove hazardous to Apple's investments.

    Actually, India is one of the most democratic of all Asian-based countries. They're nowhere near as Communistic as one might think.  And slow economic growth doesn't mean lack of potential for growing iPhone's user base.  India's middle class is huge.

  • Reply 4 of 22
    The BRIC hype is a bust. Those countries are growing (economically) slower than was originally theorized.

    Also if Apple moves any manufacturing to India, they'd be wise to move very slowly. The near-Communistic attitudes there could prove hazardous to Apple's investments.

    Wouldn't that statement about communism also hold true for China, which has a long history of production and a more event history of amazing growth for Apple?
  • Reply 5 of 22
    solipsismy wrote: »
    Wouldn't that statement about communism also hold true for China, which has a long history of production and a more event history of amazing growth for Apple?

    China is the "shop floor for the world" (a phrase they love to use), whereas India has no such high tech manufacturing base.
  • Reply 6 of 22
    Quote:

    Originally Posted by sog35 View Post

     

    India is the next big market for growth.

     

    i think we see growth from China the next 3-5 years at least.

    And after that India the next 5 years.

     

    So Apple has 10+ years of growth that is untapped.  They can easily grow revenue at an average of 7% the next 10 years.  


     

    I think that is off by a 2-3 years.

     

    India is the 3rd largest smartphone market currently, and yet it has only 30% penetration. China has a 95% penetration on smartphones. 

  • Reply 7 of 22
    iamnemani wrote: »
    I think that is off by a 2-3 years.

    India is the 3rd largest smartphone market currently, and yet it has only 30% penetration. China has a 95% penetration on smartphones. 

    There is also a much larger number of very low income earners in India and it's a toss up whether India will actually be able to improve their economy to benefit from modern technology that runs counter to religious beliefs or simply counter to traditional attitudes about class.

    http://www.pewresearch.org/fact-tank/2015/07/15/china-india-middle-class/
  • Reply 8 of 22
    Quote:

    Originally Posted by SpamSandwich View Post





    The BRIC hype is a bust. Those countries are growing (economically) slower than was originally theorized.



    Also if Apple moves any manufacturing to India, they'd be wise to move very slowly. The near-Communistic attitudes there could prove hazardous to Apple's investments.



    Don't think the problem in india is communistic attitudes. It is more the democratic setup, which means nothing can be done quickly or on somebody's whim (neither good nor bad). Also, the population means there is a premium on all resources (its a third the size of US with 3 times the population, so land is precious). A workable consensus always has to be built to move forward. 

     

    Also, the poverty forces the labor laws to be more employee friendly. 

  • Reply 9 of 22
    melgrossmelgross Posts: 31,209member
    canukstorm wrote: »
    Actually, India is one of the most democratic of all Asian-based countries. They're nowhere near as Communistic as one might think.  And slow economic growth doesn't mean lack of potential for growing iPhone's user base.  India's middle class is huge.

    India is a terrible for foreign companies. It's a slso a terrible place for Indian companies. Corruption is endemic. Individual states have hugely different rules and tax structures, as well as vastly different ruling parties, with the cult of personality thriving.

    The infrastructure is also terrible, with electric power being extremely unreliable, with a large portion of the underpowered grid being siphoned off illegally. Water is inadequate, and too often polluted. Air pollution in Indian cities is the worst in the world. Tax policies, particularly for foreign firms, is unfair, as are import duties, which are among the world's highest. The requirement of technology sharing is similar to that in China.

    Overall, India is a very bad place to invest. They are well behind China in every area, and the government has shown no inclination to change it. Moda, as part of his platform, has stated that his intention is to sharply increase the use of coal in the country for new power plants.

    I'd stay away.
  • Reply 10 of 22
    ronnronn Posts: 301member
    There has to be an attitude of give and take. The Indian govt is too hard-line re foreign ownership, scaring away manufacturing partners. And they're way too involved (communistic like another poster said?) in business affairs. I'm leery of their interests and outreach to foreign business.
  • Reply 11 of 22
    melgrossmelgross Posts: 31,209member
    solipsismy wrote: »
    Wouldn't that statement about communism also hold true for China, which has a long history of production and a more event history of amazing growth for Apple?

    Well, actually, the Chinese economy is more like what conservatives in this country would like. China has never been communist. Actually, there has never been a communist country. Communist parties, despite their name, are really socialist parties. The present ruling party is more of a business party than anything else. We have more of an unbridled capitalistic system there than here. And they're moving more to that all the time, though their economic situation is slowing that move right now.

    No real social security. No real Medicare, unions are controlled, and not allowed to strike or undergo collective bargaining. Few companies or government pensions are offered. Taxes on the very wealthy and large corporations are very low, while taxes on the middle class are fairly high.

    I can just go on and on.
  • Reply 12 of 22
    melgrossmelgross Posts: 31,209member
    There is also a much larger number of very low income earners in India and it's a toss up whether India will actually be able to improve their economy to benefit from modern technology that runs counter to religious beliefs or simply counter to traditional attitudes about class.

    http://www.pewresearch.org/fact-tank/2015/07/15/china-india-middle-class/

    It's sad about India. Decades ago, it looked as though India would be rushing into the modern world, but that never happened. It looks as though it may never happen, at least not in the foreseeable future. If anything, it appears to be moving backwards, with the country, per capita, becoming poorer.
  • Reply 13 of 22
    melgrossmelgross Posts: 31,209member
    iamnemani wrote: »
    I think that is off by a 2-3 years.

    India is the 3rd largest smartphone market currently, and yet it has only 30% penetration. China has a 95% penetration on smartphones. 

    But most of those phone are very inexpensive models. The middle class in India is nowhere as large as that in China. And the term middle class varies according to the economy. So the middle class of China, which is between 400 and 600 million, depending on which figures are being used, are poorer than the middle class in the USA. The middle class in India is very small, and even poorer.

    http://scroll.in/article/740011/everyone-in-india-thinks-they-are-middle-class-and-almost-no-one-actually-is
  • Reply 14 of 22
    Quote:

    Originally Posted by SpamSandwich View Post



    The BRIC hype is a bust. Those countries are growing (economically) slower than was originally theorized.



    Also if Apple moves any manufacturing to India, they'd be wise to move very slowly. The near-Communistic attitudes there could prove hazardous to Apple's investments.

     

    Quote:

    Originally Posted by melgross View Post



    India is a terrible for foreign companies. It's a slso a terrible place for Indian companies. Corruption is endemic. Individual states have hugely different rules and tax structures, as well as vastly different ruling parties, with the cult of personality thriving.



    The infrastructure is also terrible, with electric power being extremely unreliable, with a large portion of the underpowered grid being siphoned off illegally. Water is inadequate, and too often polluted. Air pollution in Indian cities is the worst in the world. Tax policies, particularly for foreign firms, is unfair, as are import duties, which are among the world's highest. The requirement of technology sharing is similar to that in China.



    Overall, India is a very bad place to invest. They are well behind China in every area, and the government has shown no inclination to change it. Moda, as part of his platform, has stated that his intention is to sharply increase the use of coal in the country for new power plants.



    I'd stay away.

    Both your views are correct, broadly-speaking, but rather backward-looking. Perhaps it reflects your experiences in doing business (or travels) there from a different generation.

     

    Yes, India has a lot of challenges for Western manufacturing; yes, most cell phones in use are lower-quality; yes, corruption is a problem. (Btw, people said the same things about China ten years ago). But all that is changing quite dramatically.

     

    There are very few places left where manufacturing can scale up to the extent it can in India. The extreme dependence on China makes a lot of people nervous, and many global companies are worried about their being held hostage to China's increasingly crazy whims on the political, military, security, and social fronts. It's no wonder that Apple's largest supplier, Foxconn, has decided to move to india in a significant way: http://www.wsj.com/articles/foxconn-plans-to-spend-5-billion-on-factories-in-indias-maharashtra-state-1439035640.

     

    ?Equally, there are very few places left where markets can scale up to the same extent it can in India.

     

    It's a matter of time before Apple will depend on India quite substantially for both its product sourcing, and as a market for future growth; the former, perhaps 3-5 years away; the latter, 5-7 years away.

  • Reply 15 of 22
    melgrossmelgross Posts: 31,209member
    [SIZE=14px]Both your views are correct, broadly-speaking, but rather backward-looking. Perhaps it reflects your experiences in doing business (or travels) there from a different generation.[/SIZE]

    [SIZE=14px]Yes, India has a lot of challenges for Western manufacturing; yes, most cell phones in use are lower-quality; yes, corruption is a problem. (Btw, people said the same things about China ten years ago). <span style="line-height:1.4em;">But all that is changing quite dramatically.</span>
    [/SIZE]

    [SIZE=14px]<span style="line-height:1.4em;">There are very few places left where manufacturing can scale up to the </span>
    extent it can in India. The extreme dependence on China makes a lot of people nervous, and many global companies are worried about their being held hostage to China's increasingly crazy whims on the political, military, security, and social fronts. <span style="line-height:1.4em;">It's no wonder that Apple's largest supplier, Foxconn, has decided to move to india in a significant way: </span>
    <span style="line-height:1.4em;">http://www.wsj.com/articles/foxconn-plans-to-spend-5-billion-on-factories-in-indias-maharashtra-state-1439035640.</span>
    [/SIZE]

    [SIZE=14px]<span style="line-height:1.4em;">?Equally, there are very few places left where markets can scale up to the </span>
    same extent<span style="line-height:1.4em;"> it can in India.</span>
    [/SIZE]

    [SIZE=14px]It's a matter of time before Apple will depend on India quite substantially for both its product sourcing, and as a market for future growth; the former, perhaps 3-5 years away; the latter, 5-7 years away.[/SIZE]

    I haven't seen positive changes in India that are dramatic. I've seen significant changes that are backwards. I see a population whose growth is out of control. I've seen more poverty than ever before. I see corruption that, if anything, is worse. Disruption in that society is ever continuing. There are states that despise the idea of foreign business. This is a country that is in major trouble. This Prime Minister has done nothing to reverse that, and his party is a disgrace.
  • Reply 16 of 22
    melgross wrote: »
    I haven't seen positive changes in India that are dramatic. I've seen significant changes that are backwards. I see a population whose growth is out of control. I've seen more poverty than ever before. I see corruption that, if anything, is worse. Disruption in that society is ever continuing. There are states that despise the idea of foreign business. This is a country that is in major trouble. This Prime Minister has done nothing to reverse that, and his party is a disgrace.

    @melgross, you never cease to disappoint with your bombastic, arrogantly sweeping statements. I think you've mentioned in some past posts that you ran some kind of business some time ago, but I think it's a bit a of a stretch to think that you know more about India than the vast number of Fortune 500 companies (and other global businesses) who happen to be sourcing, selling, or doing R&D there do. And fwiw, whether you'd stay away or not, Apple will likely be one of them. It's a matter of time.

    But, hey, humility was never the strong suit of New Yorkers, so I understand.
  • Reply 17 of 22

    It is so democratic that it bars television channels from neighbouring countries. Their media is filled with propaganda and states in North East who want separation from India are dealt with most undemocratic ways, and referendums are banned in those places along with Kashmir.

  • Reply 18 of 22

    High tech manufacturing will move to South East from China, and not India, and that has been the trend. I believe Indians are good in computer programming, accounting, business management, and everything to do with using the brain, but I doubt it is the case with manufacturing be it high tech or low tech where they need to use their hands more, and I believe India and Indians should recognise their strengths and avoid areas where they are weak. 

  • Reply 19 of 22
    Quote:

    Originally Posted by melgross View Post





    But most of those phone are very inexpensive models. The middle class in India is nowhere as large as that in China. And the term middle class varies according to the economy. So the middle class of China, which is between 400 and 600 million, depending on which figures are being used, are poorer than the middle class in the USA. The middle class in India is very small, and even poorer.



    http://scroll.in/article/740011/everyone-in-india-thinks-they-are-middle-class-and-almost-no-one-actually-is



    Please note I said "smartphone" not phone. There are a lot of low end phones in india, and yet india is the third largest smartphone market in the world. Those are hard numbers speaking, not my opinion.

  • Reply 20 of 22
    melgrossmelgross Posts: 31,209member
    @melgross, you never cease to disappoint with your bombastic, arrogantly sweeping statements. I think you've mentioned in some past posts that you ran some kind of business some time ago, but I think it's a bit a of a stretch to think that you know more about India than the vast number of Fortune 500 companies (and other global businesses) who happen to be sourcing, selling, or doing R&D there do. And fwiw, whether you'd stay away or not, Apple will likely be one of them. It's a matter of time.

    But, hey, humility was never the strong suit of New Yorkers, so I understand.

    Bs. You don't know what you're talking about. Everything I've said is what has been said in those journals. Wake up, read the link I provided. It gives some idea. Do,you want to see more?
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